From Social CRM to Web3: Shane Mac’s Vision for Decentralized Communication

XMTP founder Shane Mac shares how he’s building the messaging layer for Web3, solving the biggest communication gap in blockchain. Learn how XMTP is creating an open, decentralized protocol for wallet-to-wallet messaging and why investors are betting big on this infrastructure shift.

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From Social CRM to Web3: Shane Mac’s Vision for Decentralized Communication

The following interview is a conversation we had with Co-founder & President of XMTP, on our podcast Category Visionaries. You can view the full episode here: $25 Million+ Raised to Build the Communication Network For Web3.

Shane Mac
Hey, Brett. What’s up? Glad to be here. 


Brett
Yeah. So before we begin talking about what you’re building there at XMTP, let’s start with a quick summary of who you are and a bit more about your background. 


Shane Mac
I’m a Founder, always have been. I was the guy in college who facebook had just come around and I started messing around with, can I get facebook data in a profile photo to show up on top of an email. And that little social data kind of pulling out of an API turned into a company called Gist.com, which is the first social CRM. And that really led me to be fascinated by social networks and people and connecting people and communication and the internet. And we grew that to about 100 million people from 2008 to 2010. And then BlackBerry, the company before the iPhone, BlackBerry acquired it in 2010, and went and worked on BBM, and that’s when I really saw messaging. And then over the last ten years, I worked on a company. I was a CEO called assist, which was business messaging platform with bots and customer service tools and marketing tools for brands. 


Shane Mac
And were the first to launch on facebook messenger, WhatsApp, et cetera, SMS. And we got acquired in 2019. And for me, I spent my whole life really thinking about communication, social messaging, when I saw web three, and really when I saw the wallet becoming the new identity. Right after a new identity is created on the internet, whether that was an email address or an SMS or a social network kind of identity, communication usually quickly follows. And it became very clear over the last few years that you can send trillions of dollars in crypto around the Internet, but you can’t send an email to it, and you can see their address. And you know someone just sent a bitcoin from one address to the other or an NFT from one address to the other, but you can’t message them. And so that is really where kind of my past and the evolution of messaging and just looking at the internet through that lens, it kind of made sense that, oh, what I’ve been focused on and thinking about since 2005 is actually still playing out. 


Shane Mac
And I love that it feels similar to me, and I’m so excited that I just get to keep working on the same thing. 


Brett
Amazing. Well, let’s talk about that same thing. So XMTP, in simple terms, can you explain to me what you guys do and what does that stand for? 


Shane Mac
It’s an extensible transport message protocol. And in simple terms, it’s a communication protocol that lets a wallet address send a message between any wallet. And so if you think about SMTP as it relates to email, that’s very similar to what we’re doing. The reason that Gmail can send a message to Outlook is because there’s a back end protocol that’s standard called SMTP that allows all of those messaging and email clients to communicate with each other. And so all we’re trying to do for web Three is be that general communication protocol that allows any wallet address or any blockchain account in Web Three to be able to send communications between each other. And the cool thing is that it’s portable. So if you don’t like, say, your messaging app that you’re using, you can just log into a different messaging app with your wallet and all of your messages are there. 


Shane Mac
That’s a pretty big shift from if you leave WhatsApp you lose all of your messages that we live in today. Got it. 


Brett
Very cool. And can you walk me through why does the world need decentralized communication? And this would be mainly for those who don’t really understand blockchain, don’t really understand the benefits of decentralization. Could you talk us through that? 


Shane Mac
Totally. I’ll talk about it in two ways. I’ll start with the use case of why I think the problem is important today and why it’s needed from a consumer lens. So in the blockchain and crypto ecosystem, you can see what wallet addresses are interacting with what wallet addresses. And in a very specific use case, like say someone owns an NFT that you want, and you can see that they own that NFT, but they haven’t added their Twitter or Facebook or any other accounts to it, but you know the address that has that NFT. And the first question people ask is, why can’t I just send them a message to say, I would love to buy that NFT off them? And if you didn’t know that someone wanted to buy your NFT in any marketplace dynamic over the last 25 years of the web, communication is really what enables that to happen. 


Shane Mac
So what we have is all of these transactional use cases happening all over web Three, but there’s no means of communication for people to communicate around the transactions that are happening. And so it enables that. And I think that’s a huge fundamental shift. And what’s happening is that we’re moving from a world where identity comes before activity to activity becomes before identity. And in web two, you knew. Hey, this is Brett. I want to send Brett a message in web three. You see, oh, this NFT is moving between a bunch of wallets and must be a really popular NFT, or they must be involved with this different community, but I don’t know its bread yet. And so the ability to communicate based on activity and then once you start communicating, you can choose to disclose the identity and how much identity and what types of information kind of changes how we think about the internet in general. 


Shane Mac
The second part is more the decentralization part. And I think this is just the most important thing because Gmail likes you to believe that email is free. Email is not free. It costs a lot of money to run communication apps. They get to mine all your data and sell it into an ad network that then makes it free for you. But if you think about all of these past platforms, they’ve got us to put all of our information in them. If you ever want to leave, take your network from them, keep connected to anyone on them or not be put into an ad network. You can’t. So to do this in the future, we have to be decentralized where developers can trust that they can build with us. It is not solely owned by anyone and that means everyone actually can use it together to be able to send messages across the entire ecosystem and not have worry that someday the API is going to get cut off and their app isn’t going to be able to kind of build anymore. 


Shane Mac
Because some web two social company decided that they wanted to build a competing client. And when you have a decentralized protocol that allows for the economics to be transparent, the incentives to be transparent, and then to really design a system where everyone within the ecosystem actually is benefiting from being involved with it and it can grow over time and not have risk that it’s going to get pulled and rugged from under you. 


Brett
Interesting. And in this scenario, if this were to be widely adopted, what would happen to companies like WhatsApp for example, would you see them just going extinct? Would they have to adapt and integrate the technology? What would be your thoughts there? 


Shane Mac
I don’t know. I’m not a person that likes to think things have to die for new things to exist. Everyone always tries to tell me that email is dead or Craigslist is dead or all these things are going to die. And from what I can tell, email is pretty big and Craigslist is doing great and Craig’s still doing customer service and looks like it’s doing just fine. And so I actually feel like it’s just a new way because there’s a new identity, which is wallets, that people are going to want to interact, that keeps their privacy, allows them to interact what they own, and the use cases they’re going to use web three for in a different way than web two. And I actually think WhatsApp will probably be used for a ton of different use cases and what it is now. But you don’t use WhatsApp usually to meet people you don’t know. 


Shane Mac
You use WhatsApp to actually message people you already know. And so in that world, there’s tons of west messaging use cases and tons of clients to allow you to communicate with who you already know. I don’t know if they all die or anything changes, but in the future, when you want to try to interact with people you don’t know, how do you know that the person you’re interacting with is the person who owns what they say they own? How do you know that the wallet address is signing the message so that you don’t send a message to someone and try to buy something off them and they don’t actually own it? Like, what happens on Craigslist? How do you interact in a world that is strangers to add more trust to something? And how do you make communication trustless? I think that’s a much bigger, different, and huge opportunity for all of us. 


Brett
Got it. Very cool. And let’s talk about funding here. So you’ve raised 25 million so far from a really impressive list of investors. Why do you think those investors are so excited about what you’re building? 


Shane Mac
What’s funny about X and TP is that it’s a moment in time and everyone had the problem themselves. It wasn’t like we had some novel idea. I think we had an idea of it earlier than others. It’s starting to be talked about a lot now in the ecosystem. But when we started talking about this, we actually went out to 49, 50 angel investors who were all founders in web three. And every single person, it wasn’t like, wow, you guys have such a novel idea. I can’t believe you thought of this. It was all we talk about already, is we need to figure out how to message that wallet. Everyone already had the problem. And so that really, I think, is why it resonated so deeply. But also our backgrounds working in communication and messaging. And then my co-founders spent the last five, seven years building in crypto already. 


Shane Mac
And so just the two of us coming together to really focus on what do we want to spend the next decade or two of our lives? I just want to keep doing communication in web three. And I think that mix of getting to work on something that we’ve spent so much time learning and understanding already, as well as a moment in time happens where the problem is felt by everyone in the ecosystem, and they’re coming to us saying, yeah, we should also do this. And I need to actually send out financial reports to all these token holders. And Robert Leshner, who is the Founder of Compound protocol, he’s one of our first angel investors. And he came to us when were talking to him. He said, I have $11 billion in a smart contract, and I can’t send a message to 90% of the people who own it. 


Shane Mac
Imagine if a bank had to communicate to all the people who have cash with them and they couldn’t. I’m like that’s a really interesting perspective. And so there was just a lot of the right use cases at the right moment in time. And I think a few years later now, it’s really starting to heat up. 


Brett
Interesting. I think I saw on CrunchBase that it was 97 investors. Is that accurate? 


Shane Mac
Yeah, it’s a lot it’s people that we know and respect in Web Three, a lot of founders, and we really just wanted to have the best kind of founders around the table who were all thinking about adding messaging. Because if we’re going to be a truly decentralized and interoperable back end, it needs to work for everyone. It needs to really make sure, and we have to gut check ourselves to understand what we’re doing wrong, to think about the things that all of them need to be on board with. And so it was very important for us to get perspectives from across the stack, from NFTs to DFI, et cetera. 


Brett
Got it makes a lot of sense. And what’s the business model behind the protocol and behind the company? How do those investors eventually see a return? 


Shane Mac
For sure, we’re solely focused on the decentralization of the protocol. Everyone who’s an investor in XMTP will have tokens in the future. Once we have that. Right now, we have no kind of plans. It’s not a current thing we’re announcing, like when that’s going to happen, but when we plan to fully decentralize and have a token. The goal is really to create a model in which it makes sense for driving healthier interactions within the entire ecosystem, to use economics to fund that. So we’re thinking about a lot of different use cases here. But really you can imagine if marketers or spammers want to send in a bunch of messages that there’s a fee to reach the recipients they want to reach, and that the incentives and the way that gets kind of sent out within the ecosystem is valuable to everyone within it. 


Brett
Got it. Makes sense. And if we just talk about blockchain here specifically, obviously there’s a huge amount of buzz and hype and noise around this space. What have you guys done specifically to really break through the noise and stand out there, would you say? 


Shane Mac
One of the main ones, which may not be the right answer, is we’re not a financial product. I think what’s very interesting to a lot of people coming into this space that we’re fortunate to be able to recruit, work with, and spend time with, they’re very interested in a core utility that’s more communication and connecting people versus the arbitrage of financial. Kind of the D Five category or NFT price go up, stuff like that. And so I really think that the fact that we’re not a financial aspect of Web Three really actually helps us stay focused on how do we build a better messaging protocol, how can we work with a lot of developers? And how can we do this differently and not get caught up in a lot of the hype and craziness and run ups of the price and crashes, et cetera? We’re just focused on how do we have a ten year kind of view of the world, how are we focused on the long term of it, and how do we build something that really can endure past all of us? 


Brett
Got it. And if we zoom out into that future, two kind of questions here what’s the next year look like for you guys? Then? What do you want that impact to be, say, ten years from now, the next year? 


Shane Mac
For us, we’re just spending time with developers. We need hundreds of developers building all the use cases, even the ones we haven’t thought of, that enable communication and Web Three to be a standard. And that really just looks like us. We’re taking part in every single eat global. We’re doing bounties all the time. We’re fully open sourced and working with developers, designing clients, and just really pushing that developer community forward is where we spend all of our time. And we’re blown away by the use cases. People are building intercom widgets and Telegram apps and kind of notifications platforms and just showing the true power of being able to do communication in Web Three, I think is the next year. What I think out to is in ten years. Imagine XMTP is the core protocol of how communication happens in Web Three. I can’t wait to sit down with the founders that we’re spending time with now who have built the next Twilios, the next sendgrids, the next billion dollar. 


Shane Mac
Companies are all built with XMTP, and those business applications have created some of the most successful and kind of the biggest companies in Web Three. And those founders are all starting to build now. 


Brett
Amazing. Well, I think that’s all we’re going to have time for today. If people want to follow along with your journey, where’s the best place for them to go? 


Shane Mac
Yeah, I’m at Shane Mac on Twitter and then at XMTP. Is XMTP where? xmtp.com is where you can go to check out everything. It links to the docs, links to all of our communications, and you can join the community on Discord as well. 


Brett
Amazing. Well, Shane, thanks so much for your time. Really appreciate it and look forward to seeing you execute on this vision. Looks really exciting. 


Shane Mac
Hey. Thank you, Brett. Have a good day. 


Brett
All right, keep in touch.

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